Should the ACC and Big East Create Their Own Bowl Game?

With the current BCS contract set to expire at the end of the 2013 season, the landscape of college football is set to change in the coming months.  In the last few weeks, the SEC and Big 12 announced that they will be creating their own bowl game, in which each conference’s champion will play, beginning in 2014.  While it is unclear what this new bowl game means to the Fiesta Bowl (in which the Big 12 champion currently plays) and the Sugar Bowl (in which the SEC champion currently plays), it is possible that both of those bowls could continue to exist after 2014.  Additionally, the bowl would likely be joining the Rose Bowl (played by the Big Ten and Pac-12 champions) and the Orange Bowl (played by the ACC champion). 

Furthermore, it is expected that in coming months, BCS commissioners will vote to approve a four-team playoff system as a modification to the current BCS system.  This four-team playoff will pit the number-one and number-four seeds and the number-two and the number-three seeds in two playoff games before contending for the National Championship game.

Given that beginning in 2014, the SEC and Big 12 champions will meet in a bowl game as will the Pac-12 and Big champions, while four teams compete for the opportunity to play in the National Championship game, should the Big East and ACC join forces to create their own bowl game?

There are two real reasons for the ACC and Big East to adopt their own bowl game:  1.  To ensure that their teams have a national stage to play a bowl game on and 2.  To earn revenue.

In considering whether creating a new bowl game is necessary for the ACC and Big East to ensure that their teams play a bowl game on a national stage, one factor to consider is the likelihood of either team’s conference playing in the four-team playoff.  A brief overview of the teams ranked number-one through number-four since the founding of the BCS in 1998 provides some guidance as to the likelihood of ACC or Big East teams competing in the four-team playoff set to begin in 2014.

Year #1 #2 #3 #4
1998-99 Tennessee FSU  Kansas State Ohio State
1999-00 FSU VA Tech Nebraska Alabama
2000-01 Oklahoma FSU  Miami Washington
2001-02 Miami Nebraska Colorado Oregon
2002-03 Miami Ohio State Georgia USC
2003-04 Oklahoma LSU USC Michigan
2004-05 USC Oklahoma Auburn Texas
2005-06 USC Texas Penn State Ohio State
2006-07 Ohio State Florida Michigan LSU
2007-08 Ohio State LSU VA Tech Oklahoma
2008-09 Oklahoma Florida Texas Alabama
2009-10 Alabama Texas Cincinnati TCU
2010-11 Auburn Oregon TCU Stanford
2011-12 LSU Alabama Oklahoma State Stanford

The only current Big East member to have been ranked in the top-four in the college football regular season standings since the founding of the BCS is Cincinnati.  Granted, Miami and Virginia Tech were both ranked in the top-four several times during their Big East tenure, however, those teams both play in the ACC now.  Thus, when looking at the entirety of teams ranked in the top-four during the BCS’ history, it would appear that the Big East needs a partnership with the ACC, much more than the ACC needs a partnership with the Big East.

However, the fact of the matter remains, that in the last three years, Cincinnati was the only school out of either conference to be ranked in the top-four at the end of the college football regular season.  Thus, by creating their own bowl game, the conferences would ensure that their respective champions would be on a national stage during a bowl game after 2014.

Thus, the next question to address, is can the ACC and Big East draw a positive amount of revenue from a bowl game?  This question, unfortunately, is not as easy to answer.  The ACC and Big East in recent years have been known more so for the talented basketball teams they field than their football prowess.  That is not to say, that each team does not have football teams which fans would travel to watch.  However, could the conferences find enough fans to travel to a bowl game to ensure its profitability?

Perhaps UConn’s appearance in the Fiesta Bowl in Tempe, AZ is an indicator as to if, and how far, fans are willing to travel for bowl games in which their teams appear.  UConn was required to sell 17,500 tickets for the event.  Six days before the bowl game, it had only sold 4,600.  Reports indicated that the school would incur the cost of the unsold tickets.  Would Big East fans be more inclined to travel to bowls closer to home?  If so, could such an endeavor be a revenue generator for the Big East and ACC?

While the ACC and Big East could benefit from joining forces to create a new bowl game, they should only do so if it is held at a location in close proximity to the bulk of each conference’s largest fan base.  Additionally, the conferences should only enter into a bowl agreement after surveys are completed determining each conference’s fan base’s commitment to paying for and attending the bowl game.  If the interest is not strong and definite, then each conference would be better off attempting to compete for one of four-team playoff seeds.

Ahead of the Game: The SEC and Big 12’s Bowl Deal

Today, the Big 12 and SEC announced that they have entered into a five-year contract which will allow champion of each conference to play each other in a New Year’s Day bowl game beginning in 2014.  The contract is tailored to fit in with the new four-team playoff model, in that if the respective Big 12 and SEC champions are set to play in that game, different schools from each conference will play in the Big 12 and SEC match-up.

In making this announcement, the Big 12 and SEC have kept themselves ahead of the game when it comes to the reorganization of the college football playoff structure resulting from the expiration of the BCS’ current deal.  This should come as no surprise to college football fans, as SEC commissioner Mike Slive has been at the forefront of proposing captivating alternatives to the current BCS system.  It was Slive who first suggested the four-team playoff system, which will likely be adopted as the new BCS alternative.  Today, Slive has once again protected the football notoriety of his conference, and the Big 12 has done the same, by ensuring that one team from each conference is present in a major, New Year’s Day bowl game.

The possibilities for this match-up are nearly endless, and quite fascinating.  When considering the conference realignment landscape that took Big 12 programs Missouri and Texas A&M to the SEC, this proposal raises the possibility that those two teams could someday face off against former rivals on national television on New Year’s Day.  For fans mourning the end of the Texas-Texas A&M rivalry, this agreement presents the opportunity for the rivalry to flourish on a large-scale stage.  Understandably, that would require both teams to become the champion of their football-competitive conference–but, at least it’s a possibility.

Questions remain about how the bowl will be orchestrated.  For instance, it is unknown whether it will be held in a set location annually, like the Pac-12 and Big Ten’s Rose Bowl, or if it will travel to a new location each year.  Given that SEC and Big 12 fans travel more than fans from other conferences, it may be worth each conference’s time to investigate the possibility of rotating the bowl game throughout various sites.  This would open up the possibility of attending the game to more of the fans who are diehard supporters of SEC and Big 12 football.  Additionally, it would raise the possibility of introducing each conference’s respective teams to new markets. 

In the future, issues that will need to be addressed as a result of this bowl marriage relate to the bowls that each conference is currently aligned with.  For instance, the Big 12 champion plays in the Fiesta Bowl each year.  Will that continue?  Is it possible that the agreement will result in the Fiesta Bowl being one of the sites that the bowl rotates through?  Furthermore, what will happen to the current Big 12 No. 2-SEC No. 4 or 5 matchup, better known as the Cotton Bowl?  Like the possibility just noted about the Fiesta Bowl, could this new bowl also rotate through the Cotton Bowl location?  What will become of the SEC champion hosting Sugar Bowl?

My hunch is that the bowls will not agree to a game which rotates amongst them.  Such would not be lucrative to the bowls.  Thus, what the Big 12 and SEC have done with this move, is to strip the respective bowls of their power and transfer it to themselves.  In doing so, they’ve opened up a bidding war of sorts, where the bowls will be expected to woo them with options.  If none is suitable to the conferences, my guess is that they will launch a new bowl which will rotate throughout Big 12 and SEC locations. 

Overall, this is a great move by the Big 12 and SEC.  It is so, because it is a move that keeps them on top of the bowl shuffling/college football playoff landscape.

Why FSU Isn’t Leaving the ACC for the Big 12

Last week, the ACC and ESPN reached an agreement which extended the network’s television contract with the conference for 15 years.  News of the agreement caused many to speculate that FSU would leave the ACC for the Big 12, under the assumption that the amount of money the school would earn under the ACC’s extended media contract was not sufficient and that FSU would be able to earn more under the Big 12’s yet-to-be-negotiated media contract.

However, in a memorandum released today, FSU president Eric Barron all but squashed any rumors of FSU leaving the ACC for the Big 12.

In the memorandum, Barron provided four reasons why alumni believe FSU should consider joining the Big 12:  the Big 12 is more football-oriented than the ACC, the Big 12 would give FSU greater football competition, the ACC provides advantages to North Carolina schools, and FSU would earn more media revenue under the Big 12’s media contract.

In response, Barron nearly doubled the reasons why FSU should not join the Big 12, providing seven explanations.  These explanations included his notations that the ACC is an equal share media revenue conference while the Big 12 is not, any additional money FSU would receive under a more lucrative Big 12 media rights deal would in turn be spent by FSU on further travel to play Big 12 schools, ticket revenue would decline as Big 12 fans would be less inclined to travel to FSU games, the sellout FSU-Miami rivalry would be lost, FSU would have to pay $20-$25 million to leave the ACC and the Big 12 is an “academically weaker” conference.

While many FSU fans may be disappointed in Barron’s response, his reaction is perhaps the most level-headed of any made during the past 18 months in which conference realignment has changed the collegiate athletics landscape.  Barron’s response provided analysis of three of the key factors driving conference realignment:  media contract revenues, travel and academics.  However, it appears that for once, the lure of media contract revenues did not outweigh the costs posed by travel and academics resulting from conference realignment.

Over the past 18 months, fans of college athletics have watched as teams have realigned themselves with conferences in far away lands, under the auspices of joining the ranks of more prestigious academic institutions, better competition, and ultimately, earning higher revenues.  However, in his memorandum, Barron indirectly called out many of these institutions on their bluff:  How can you promote academics and earn more revenue, when you are requiring your student-athletes to travel further distances and expending more money to meet a growing travel budget?

In recent months, I have been given great access into top Division-I athletic department’s budgets.  Across the board, the highest expense any athletic department incurs is for travel.  Athletic departments that compete in localized geographic areas already shell out millions of dollars per year to pay for travel.  Imagine how much the amount spent on travel will increase when schools join conferences with geographic reaches across the nation?  Will it double?  Triple?  Will the possibility of earning $2 million more per year under a media rights agreement balance the additional travel costs incurred by the athletic department, while also negating the time lost to study by student-athletes required to travel further distances for competition?  Only time will tell.

Today, many may be chastising Barron for his memorandum and apparent disinterest in moving FSU to the Big 12.  However, ten years from now, it will be interesting to see what FSU has gained (and likewise, what it may have lost) by remaining in the ACC.

Television Contract Breakdown – Updated

One of the most popular posts in the history of BusinessofCollegeSports.com was Kristi Dosh’s post breaking down the television contracts in each AQ conference. She’s updated that post over on ESPN.com with the news of the ACC’s new deal. 

Wisconsin’s Athletic Department Budget – Expenses

Yesterday, BusinessofCollegeSports.com gave you an exclusive, in-depth look into Wisconsin’s athletic department revenues.  Previously, BusinessofCollegeSports.com reported that per data obtained from the Department of Education, Wisconsin had the 9th highest expenses of all Division I schools.  Randy Marnocha, Wisconsin’s Associate AD for Business Operations graciously provided BusinessofCollegeSports.com with in-depth information about Wisconsin’s expenses for 2010-11.

In 2010-11, Wisconsin had operating expenses of $80,855,012.00 and capital expenses of $3,010,174.00.

The chart below depicts the items making up Wisconsin’s $80,855,012.00 worth of operating expenses.

Operating Expenses Amount
Salaries & Fringes $32,919,613.00
Operating Expenses $28,519,000.00
Debt Services $10,171,200.00
Financial Aid $5,506,631.00
Post Season $3,738,568.00

The following account for the $28,519,000.00 Wisconsin spent on “operating expenses” last year:  Business travel, team travel, recruiting travel, interview/relocation costs, advertising, concessions/catering resales, team meals/catering/housing, guarantees, equipment maitenance and repairs, building/grounds maintenance and repairs, membership dues (Big Ten Conference, etc.), officials, postage/freight, printing, prizes and awards, equipment rentals, space rentals, medical services, police services, professional services, subscriptions, athletic equipment, building and grounds supplies, medical supplies, office supplies, telephone service, and insurance/property tax.

With respect to debt services, the figure shown above includes the total paid off by Wisconsin on various capital projects.  In particular, in 2010-11, Wisconsin paid off $6,723,150.00 on its football stadium, Camp Randall, and $2,571,736 on its basketball and hockey facility, the Kohl Center.

The financial aid amount reflected is composed of the following:  Scholarships, tuition remissions, NCAA Opportunity Fund, NCAA Special Assistance and a continuing education fund.  The largest expenditure in the financial aid section went toward scholarships, for which Wisconsin spent $9,595,562.00 in 2010-11.  Notably, this amount was lower than that which Wisconsin expended on scholarships in 2009-10.  In 2009-10, Wisconsin spent $9,389,828.00 on scholarships.

The following chart depicts Wisconsin’s 2010-11 post season revenues and expenses.  The revenues and expenses are calculated for all of Wisconsin’s teams which participated in their respective 2010-11 post seasons.  Those teams included:  Football, men’s and women’s basketball, men’s and women’s hockey, men’s and women’s soccer, softball, men’s and women’s swimming, men’s and women’s tennis, volleyball and wrestling.

Post Season Revenue $2,579,248.00
Post Season Expenses $3,738,568.00
TOTAL ($1,159,320.00)

Notably, Wisconsin suffered a loss overall when it came to post season participation in 2010-11.  It should be noted, however, that in 2010-11, Wisconsin received a bowl payout of$2,493,258.00 from the Big Ten Conference.

BusinessofCollegeSports.com would like to extend a gracious “thank you” to Randy Marnocha for his assistance with this series and his generosity with his time.

Wisconsin’s Athletic Department Budget – Revenues

Recently, BusinessofCollegeSports.com wrote that per data obtained via the Department of Education, Wisconsin’s athletic department had revenues of $93,594,766.00 and expenses of $92,939,345.00 in 2010-11.  Comparing these numbers to those that other athletic departments submitted to the Department of Education demonstrated that in 2010-11, Wisconsin had the 9th highest expenses and the 12th highest revenues of all Division I athletic departments.

Given the idiosyncracies of the Department of Education data for athletic departments, BusinessofCollegeSports.com followed up with Wisconsin’s athletic department to delve deeper into their budget.  Randy Marnocha, Wisconsin’s Associate AD for Business Operations graciously opened up the athletic department budget to BusinessofCollegeSports.com.  What follows is an exclusive, in-depth look into Wisconsin’s revenues and expenses.

Today, Wisconsin’s revenues will be examined.  Tomorrow, BusinessofCollegeSports.com will post Wisconsin’s athletic department expenses for 2010-11. 

The chart below depicts the revenues that Wisconsin reported to both the NCAA and the Department of Education.  As BusinessofCollegeSports.com has previously explained, there are differences in these two reports which account for the different revenues that a school reports to each.  For instance, Wisconsin does not report utilities to the Department of Education, while that number is reported to the NCAA. 

Revenue Revenue Reported to the NCAA Revenue Reported to the DOE
Operating Revenue $80,941,888.00 $80,941,888.00
Capital Revenue $799,792.00 $799,792.00
Big Ten Media (Campus) $2,772,546.00 $2,772,546.00
Coaches Camps & Clinics $1,707,848.00 $1,707,848.00
Adidas Allotment $928,882.00 $928,882.00
UWF Gifts in Kind $332,597.00 $332,597.00
UWF Special Account $1,119,638.00 $1,119,638.00
UWF Other Expenses $286,925.00 $286,925.00
Institutional Support $4,553,901.00 $4,553,901.00
Utilities $2,788,000.00 $0.00
TOTAL $96,232,017.00 $93,444,017.00

As depicted above, the largest source of Wisconsin’s athletic department revenue came from operating revenue.  The following items make-up Wisconsin’s operating revenue:  Ticket sales, revenue received from the Big Ten Conference, gifts in kind, concessions and catering, media revenue, events, post season revenue and “other” (which will be described below).  Below is a snapshot of how much each of these revenue streams contributed to Wisconsin’s overall operating revenue.

Revenue Stream Amount Generated
Ticket Sales $27,333,230.00
Gift Funds $13,861,398.00
Conference $19,664,187.00
Concessions/Catering $6,853,405.00
Multi Media $5,007,040.00
Events $1,081,868.00
Other $4,561,511.00
Post Season $2,579,248

The chart below depicts the amount that Wisconsin teams were able to generate through ticket revenue.  Unsurprisingly, football leads the way.  Perhaps, the most interesting thing to note in this chart, is the great disparity between men’s sports and women’s sports ticket sales.

Team Ticket Revenue
Football $18,285,170.00
Men’s Basketball $5,369,181.00
Men’s Hockey  $3,398,978.00
Women’s Basketball $138,893.00
Volleyball $74,880.00
Women’s Hockey $43,303.00
Varsity Sports $22,825.00

In 2010-11, Wisconsin received $19,664,188.00 in revenue from the Big Ten Conference.   The chart below depicts the amount of revenue Wisconsin received from the Big Ten Conference.

Conference Payout Amount
Big Ten Media $13,903,475.00
Football Bowls $2,493,258.00
Football Tickets ($850,722.00)
NCAA Broad Based $3,286,099.00
Big Ten MBK Tournament $385,574.00
Basketball Tickets ($80,353.00)
Other $526,857.00
TOTAL $19,664,188.00

The “NCAA Broad Based” payout noted above includes payments made by the conference for the NCAA basketball fund distribution (teams earn one unit for each NCAA March Madness game they play in, except for the National Championship; conferences distribute the money derived from these units), sports sponsorship and grants in aid, and any supplemental distributions, if approved.  Additionally, negative numbers are shown for football tickets and basketball tickets.  This is because Big Ten Conference members pay into a ticket pool.  If a school makes over a certain amount in ticket revenue, they pay into the pool.  Schools falling below the ticket revenue amount receive a payout from the Big Ten Conference.   

Next, is a chart depicting the revenue generated by Wisconsin’s advertising ventures.

Advertising Revenue Amount
Learfield/BSP $3,559,814.00
Adidas $460,000.00
Coca-Cola $4,377.00
CR Chairbacks $537,849.00
Other $445,000
TOTAL $5,007,040.00

Wisconsin has an advertising contract with Learfield/BSP.  According to Marnocha, “They do most of the signage around the facilities, radio spots, television spots, etc.  They sell the rights to advertise in our media guides and programs.  They sell the advertising for the big, LED signage that we have in the stadium.”  With respect to the adidas and Coca-Cola amounts, Marnocha notes, “These amounts are part of adidas and Coca-Cola’s contracts with us and they give us a certain amount of money to advertise their products.”  CR Chairbacks refers to Camp Randall Chairbacks, sold for the football stadium. 

With respect to the post season, the chart below highlights Wisconsin’s overall post season revenues.  This amount is for all Wisconsin teams that participated in the post season in 2010-11.  Those teams included:  Football, men’s and women’s basketball, men’s and women’s hockey, men’s and women’s soccer, softball, men’s and women’s swimming, men’s and women’s tennis, volleyball and wrestling.

Post Season Revenue $2,579,248.00

As for catering and concessions, the following chart breaks down how much revenue was generated through catering, events and at specific team’s games:

Concessions and Catering Amount
Catering $2,571,519.00
Football $1,873,729.00
Events $997,117.00
Men’s Basketball $723,244.00
Men’s Hockey $556,843.00
Other Sports $261,009.00

The next chart depicts the revenue that Wisconsin receives from the Big Ten’s media contracts.  One thing to note, is that a significant portion of the amount of money Wisconsin receives from the Big Ten Network is returned to the Wisconsin campus and not used by the athletic department.  Additionally, according to Marnocha, each Big Ten Conference school receives the same Big Ten Network payout each year. 

Big Ten Media Revenue Amount
ABC/ESPN/CBS $8,709,710.00
Big Ten Network $7,894,078.00
Athletic Department Portion from BTN $5,193,765.00
Campus Portion from BTN $2,772,546.00

The portion of “other” revenue depicted in Wisconsin’s operating revenues is composed of the following:

Other Revenue Amount
Licensing $1,320,000.00
Processing Fees $1,383,937.00
Interest Income $35,883.00
Parking $893,018.00
Merchandising $396,109.00
Guarantees $328,000.00
Miscellaneous $204,564.00

Visit BusinessofColllegeSports.com tomorrow to get an inside look into Wisconsin’s athletic department expenses.

A Lesson in Superconferences: How Can the WAC Survive?

Over the last 24 months, conference realignment has reshaped the landscape of collegiate athletics.  The constant flux of teams switching conferences, along with conferences working  to amass the greatest number of member institutions leads one to question whether superconferences are all they’re cracked up to be.

The apparent victim in the most recent round of conference realignment is the WAC.  Reports indicate that WAC members Utah State and San Jose State are set to leave the conference for the Mountain West Conference in 2013.  Additionally, UT-San Antonio, which was set to join the WAC this season is expected to break with those intentions and join Conference USA.  With Utah State and San Jose State leaving for the Mountain West and UT-San Antonio not joining the conference, the WAC is left with only four football-playing schools. 

In response to these reports, WAC interim commissioner Jeff Hurd asserted that the conference will remain viable and the conference is evaluating different options to address its defecting members.  In considering options, should the WAC seek out numerous new members with the goal of becoming a super conference, or rather, should it rebrand itself as a conference focused on a specific sport?  

Founded in 1962, the WAC initially was the conference of six members:  Arizona, Arizona State, BYU, New Mexico, Utah and Wyoming.  The creation of the wake resulted in the demise of Border and Skyline conferences.  While Arizona and Arizona State experienced competitive success as WAC members, they eventually left the conference to join what would become the Pac-12.  However, by 1980, the WAC had increased its membership by 50 percent, adding UTEP, Colorado State, San Diego State, Hawaii and Air Force.  The expanse covered by the WAC was growing as the conference’s membership grew.

In 1996, the WAC achieved the ranks of superconference status when its membership totaled 16 schools.  Along with its previous 9 members from 1980, the WAC added:  Fresno State, Rice, TCU, SMU, San Jose State, UNLV and Tulsa.  Started as a conference limited to a specific geographical region, the conference now had schools in four time zones and stretched across 3,900 miles.

While the saying “bigger is better” may be true for most things, it was not so for the WAC.  With schools located across 3,900 miles, travel expenses skyrocketed for member institutions.  Additionally, reports indicate that some members were concerned that the original academic and athletic focus of the conference was lost in expansion.  The consequences of superconference expansion were felt in 1999, when three of the remaining four original members, along with three WAC newcomers left the conference to form the Mountain West Conference.

The lesson here, is an important one to the WAC (and other conferences, for that matter), when it comes to drafting plans to move forward as a conference under the current landscape of collegiate athletics.  While in recent months, there have been vigilant efforts by conferences to organize coups of other conference’s members, superconference status does not always guarantee success. 

Rather, conferences should be concerned first and foremost with drafting a long-term vision for their conference.  Will the conference achieve success by fielding football teams, or will it find steadiness in focusing upon other sports?  Would the conference be better suited if its members were located in one region of the country or would it be more financially responsible for the conference to be spread out across all corners of the nation?  In seeking out members, is it important to the conference that institutions represent academic integrity and success?

Ultimately, when you look at the most successful conferences of past decade, there is a cohesiveness about them that the WAC was lacking.  The “Big Six” are tied together by geography, success in either football or basketball and institutions that for the large part, promote academic excellence.  In moving forward, any conference on the verge of death, should spend considerable time fleshing out what the conference’s new keystones will be before arbitrarily inviting institutions to become new members.

A Lucky Opportunity: How Andrew Luck’s Success Has Helped Stanford Athletics

One thing is certain to happen this evening at Radio City Music Hall:  The first name to be called in the 2012 NFL Draft will be that of former Stanford quarterback Andrew Luck.

In his four years at Stanford, Luck threw for 31 wins, led Stanford to three bowl appearances and was a runner-up for the Heisman Trophy twice, all while completing an engineering degree in architectural design.  Luck’s impressive resume at Stanford left the university with not only a stronger football program, but with a great marketing opportunity.

Joe Karlgaard has served as Stanford’s Senior Associate Athletic Director for Development since February 2011.  Prior to that, he was the athletic director at Oberlin College for six years and as a Stanford student, worked in Stanford’s track and field office.  When asked whether a Stanford student-athlete has captivated donors like Luck, Karlgaard says the school has never seen a current student-athlete as celebrated as Luck.

“I think that Andrew certainly has a profile in college athletics that we haven’t seen at Stanford in a long time.  Tiger Woods may have a similar profile, but his profile grew after he left Stanford and won the Masters.  Luck is a two-time Heisman finalist, who helped us turn around our football program and performed well in the classroom,” Karlgaard explained.

The profile Luck developed during his four-year tenure at Stanford has assisted the Stanford athletics department in fundraising.  In particular, the athletics department has received two anonymous donations totaling $15 million dollars from donors who said they were inspired by Luck.  While these large donations were definitely given as a result of Luck’s presence at Stanford, Karlgaard believes that Luck has motivated others to donate money to the Stanford athletics department.

The $15 million which the Stanford athletics department received from donors who were inspired by Luck will only further propel Luck’s positive presence on the campus.  According to Karlgaard, the $15 million will be used to fund endowment and capital projects.  One capital project that will be funded in part by the $15 million donation, is Stanford’s renovations to its Arrillaga Family Sports Center.  Stanford will break ground this summer on the 18 month renovation process to the facility.  Renovations will include an expanded weight room, new football locker room, two new auditoriums, new football coaches offices and new film rooms.  The total cost of the renovations to the Arrillaga Family Sports Center is expected to be $18 million, of which Karlgaard indicates has all been raised by Stanford.

Luck’s presence as Stanford has been used by the athletics department to generate annual giving donations.  Stanford athletics utilizes the website BuckCardinal.com for annual giving purposes.  As of this Tuesday, the front page of the website features a nine-and-a-half minute video featuring Luck discussing his experience at Stanford.  Karlgaard said that the email was pushed out to donors who have not given this year to the annual find with invitation for them to donate to the athletics department.  Within 24 hours of the video being uploaded, it had received over 2,000 page views.

As for whether Luck’s being drafted number-one will further motivate donors to give money to Stanford athletics, Karlgaard said, “I don’t think his going number-one necessarily changes the minds of our donors regarding how they feel about Luck or Stanford football.  He’s the whole package.  He’s the consummate student-athlete as Stanford envisions it.  His success on the football field and his commitment to finishing his degree in a rigorous subject, like architecture, have inspired our donors at a variety of levels.  I don’t think his going number-one has any real impact.  If the Colts decided to take Robert Griffin III, I don’t think we would see any real downturn to our donations for development.”

Today, there is an air of excitement on the Stanford campus, as the school’s quarterback is expected to be the first name called in the NFL Draft.  However, given the profile Andrew Luck built-in his four years at Stanford, his name will certainly continue to ring out on Stanford’s campus.

Georgia Tech’s Recruiting Expenses

Previously, BusinessofCollegeSports.com showed you which schools spent the most on recruiting per data obtained from the Department of Education.  In reporting this data, BusinessofCollegeSports.com noted that imperfections exist within the data, but that the Department of Education data was the only publicly available source listing recruiting expenses for public and private institutions.

After that report was published, BusinessofCollegeSports.com followed up with several schools in an effort to obtain more accurate records of their recruiting expenses.  Georgia Tech Athletics’ Chief Financial Officer, Frank Hardymon, graciously detailed Georgia Tech’s recruiting expenses for BusinessofCollegeSports.com

Per data obtained from the Department of Education, Georgia Tech’s recruiting expenses were the 7th highest of all BCS schools in 2010-11.  In that year, Georgia Tech had total recruiting expenditures of $1,489,599.00, spending $1,173,904.00 on recruiting for its men’s sports and $315,695.00 on its women’s sports.  Georgia Tech’s total recruiting expenditures put it only behind those of Tennessee, Auburn, Notre Dame, Alabama, Georgia and Florida, when comparing data submitted to the Department of Education.

Hardymon was able to provide logical explanations as to why Georgia Tech’s recruiting expenses appeared higher than most other BCS schools.  In simplest terms, every school reports things differently.  Hardymon explained, “Everybody reports things differently.  Every school has different ways of doing accounting, so they show expenses under different categories.” 

Additionally, Hardymon explained that the items the Department of Education asks to be reported are not the same as what is required to be reported to the NCAA.  Thus, it is possible that a school’s revenues and expenses may appear to be different on each report.  “You can end up with two completely different bottom lines, which can lead people to question the quality of your accounting if you have two different totals,” said Hardymon. 

Furthermore, according to Hardymon, the Department of Education does not want athletics departments to report losses.  Thus, while the Department of Education report depicts many athletics departments having zero net income in 2010-11, it is possible that many of these athletics departments actually suffered a loss in 2010-11.  “Their theory is, if you had a loss, you’re still an operating entity, so somebody must have covered it for you.  They have us report the loss as if the school floated us the difference,” said Hardymon.  For athletics departments like Georgia Tech, which are a separate corporation from their university counterpart, this presents an issue, as the athletics department is solely responsible for any losses it incurs.

Hardymon noted that Georgia Tech is “very inclusive on recruiting” in terms of what the athletics department shows as a recruiting expense on its reports to the Department of Education and NCAA.  Part of Georgia Tech’s ability to inclusively report its recruiting expenses, is the result of the accounting system Georgia Tech uses.  Hardymon explained, “We are able to code a lot of things as recruiting.  So anything—even if it isn’t an immediate recruiting expense, but is going to turn into one, like buying envelopes, stationary and postage to be sent to recruits—is going to be listed as a recruiting expense.”   

Georgia Tech’s inclusiveness in reporting its recruiting expenses is likely what made its expenses the seventh-highest of all BCS schools in the Department of Education report.  While the Department of Education report only reports recruiting expenses as lump sum numbers, Hardymon provided BusinessofCollegeSports.com with an inside look of what some of the $1,489,599.00 spent by Georgia Tech on recruiting went toward.

First, the football program undertook an initiative to update the materials it distributes externally.  “Football makes a pretty strong commitment to communicate in writing with potential recruits,” said Hardymon.  According to Hardymon, “this initiative created $300,000.00 in expenses for the Athletic Association, which were categorized in football recruiting.”  It is important to note that the entire $300,000.00 was expensed towards recruiting in 2010-11, although some of the materials will be used for years beyond 2010-11.  Hardymon asserted that when “office-type expenses,” like the football program mailers were removed from Georgia Tech’s recruiting expenses, Georgia Tech’s recruiting expense total fell below $1 million.  Hardymon believes that this number is a more accurate representation of Georgia Tech’s recruiting expenses when compared to those of other programs.

The bulk of Georgia Tech’s recruiting expenses went towards travel costs.  In 2010-11, Georgia Tech spent $1,007,897.00 total on airfare, meals, hotels, entertainment, transportation, and development for on and off-campus recruiting.  The big-ticket item in Georgia Tech’s travel expenses for recruiting, though, is airfare expenses incurred by both basketball programs and the football program.  Hardymon said that while Georgia Tech does use a charter airline company, the company is relatively inexpensive and that the coaches also largely use commercial airlines to travel.  

 The numbers provided by Hardymon related to Georgia Tech’s recruiting expenses, along with his explanations as to why different athletics department’s expenses may seem vastly different, provided great insight into the budgetary concerns of a top athletics department.

Boston College Hockey’s National Championship Victory and Development Fundraising

In the last five years, Boston College has secured its spot as home of one of the most dominant Division I hockey programs.  In the last five years, the Eagles have won the Division I hockey championship three times.  Their most recent win came last weekend, when Boston College defeated Ferris State 4-1.

How has this surge in the hockey team’s prowess benefited fundraising for development?  Steve Novak is Boston College’s Assistant Athletics Director for Athletic Development.  When asked whether the recent Division I hockey championship would boost donations, Novak provided the following insight:

“Our hockey program has achieved such heights over the years that one year or one championship does not necessarily influence overall giving in a noticeable way.  However, I can certainly attest to the fact that the consistent performance and leadership under Jerry York has influenced any number of donors and/or gifts to BC Athletics.  We have seen several gifts directed to hockey over the years to support scholarships or other expenses.  Often, these donors cite the great pride they have when they root for BC Hockey.”

In an age in which football and basketball dominate the college athletics headlines–two sports which are present on Boston College’s campus–it speaks loudly to the talent of Boston College’s hockey team that a number of donors specifically direct funds to the hockey team’s development.

Given the hockey team’s frequent presence in the Frozen Four and national championship game in recent years, the question arises as to whether Boston College capitalizes upon the appearances as opportunities to fundraise.  Novak indicated that Boston College, “do[es] a lot of stewardship around special events like Frozen Fours or bowl games.  We have not chosen to do specific fundraisers.  It is more of an opportunity to say ‘thank you’ to those who helped us get to this point through their ongoing and past support.”

Along with funding scholarships for student-athletes, Novak and members of his athletics development staff fundraise to build new facilities or improve existing facilities.  In 2007, Boston College opened the doors to the $27 million Yawkey Athletics Center.  According to Novak, “This was the first building on campus to be 100% privately funded.”  Going forward, Boston College will break ground soon on a baseball and softball complex on its Brighton Campus.  Additionally, according to Novak, the athletics department “. . . also make[s] several facility improvements each year throughout our athletics facilities.  These otherwise ‘small’ items add up to be significant expenses.  However, it is extremely important to put our best foot forward.  The aesthetic improvement over the last several years is noticeable.  Athletics is certainly not the most important aspect of the University, but it often is the most visible.” 

The success of its hockey team and the work of its athletics department and development staff in recent years gives Boston College fans much to cheer about.